BEARING WITNESS TO ECONOMIC
INJUSTICES OF UNDOCUMENTED
IMMIGRANT FAMILIES:
A NEW CLASS
OF "UNDESERVING" POOR
Francine J. Lipman*
I.
INTRODUCTION:
BEARING WITNESS
Seven fifty-five, Wednesday evening, November 8, the day before her
eighty-second wedding anniversary and twenty-nine days before her 100th
birthday, my grandmother slipped away from the American family and dream
that she loved every day of her life. A first generation United States citizen,
Rose was born at home on 15th Street in New York City to twenty-something
Russian immigrants. Her father, Eli, had traveled to America at the turn of the
century to find work and a better life for his family. Eli eventually earned
enough money to send for several members of his close family, including his
beloved wife, Annie. Annie stepped on American soil in 1904, and her only
child, my grandmother, was born on December 7, 1906.
Like thousands of other Russian iminigrants escaping anti-Semitism at the
turn of the century, Eli arrived on the shores of America and enjoyed equality
and freedom. America offered Eli the promise of a better tomorrow and it
delivered. In 1933, the Nazis came to power in Germany with more than nine
million Jews living in Europe. By 1945, only three million had survived
Adolph Hitler's Final Solution. America provided Eli and his family, Russian
Jews, with a safe haven from the horror of the Holocaust.
The Holocaust,' the intentional and premeditated genocide of Jews,2 was
the result of institutionalized racism. If America had not been the Promiseland
for my family, my great-grandparents and grandparents likely would not have
survived the Holocaust, and my parents would have never been born. And you
would not be reading this Essay.
More than one hundred years later, immigrants still travel to America
seeking work and a better life for their families. Although the percentage of
immigrants to the total population is lower today than at the turn of the century,
because of restrictive immigration policies millions of immigrants are living
* Professor of Law, Chapman University School of Law.
The word "Holocaust" is Greek in origin and means literally that which is offered up or a
burnt sacrifice. The term has acquired the secular meaning of a complete sacrifice or
destruction, especially by fire, of a large number of human beings.
2 While six million Jews were murdered in the Holocaust, Hitler's Final Solution also
included the intentional murder of Gypsies, homosexuals, people with disabilities, Jehovah's
Witnesses, and countless resisters of Nazism. See generally INA R. FRIEDMAN, THE OTHER
VICTIMS:
FIRsT-PERSON STORIES OF NON-JEWS PERSECUTED BY THE NAZIS (1990).
Summer 2007]
BEARING WITNESS
and working in the United States without government authorization. The most
commonly used term to describe these immigrants is "illegal aliens," which "is
racially loaded, ambiguous, imprecise, and pejorative." 3
The history of the Holocaust and other atrocities reveal that hateful words
lead to hateful acts. Racist terms compromise any hope of thoughtful debate.
In this Essay, I will use the term "undocumented immigrants" to refer to "people who presently possess no proof of any right to be present in the United
States, whether or not they have been declared deportable by the U.S. government (and the vast majority have not)." 4 In addition, I will use the term "unauthorized workers" to describe people who are forbidden under the immigration
laws to work for pay. 5
Since 1995, the average number of undocumented immigrants arriving in
the United States has exceeded the average number of arrivals of documented
immigrants. 6 In 2006, there were approximately twelve million undocumented
immigrants residing in the United States, including more than seven million
unauthorized workers, who comprise approximately 5% of the U.S.
workforce.' Current immigration restrictions are impracticable and oppressive.
Oppressive restrictions on immigration seem "to derive from fear of (or
distaste for) foreigners, especially foreigners of minority races or ethnic
groups." 8 More recently, undocumented immigrants (57% to 70%) originate
predominately from the U.S.'s southern-border neighbor, Mexico. 9 UndocuI
Beth Lyon, When More "Security" Equals Less Workplace Safety: Reconsidering U.S.
Laws that DisadvantageUnauthorized Workers, 6 U. PA. J. LAB. & EMP. L. 571, 576 (2004)
(citations omitted). In her article, Professor Lyon presents a thoughtful, comprehensive and
necessary analysis about the appropriate terminology for non-U.S. citizens and their immigration status. Id. at 573-82.
4 Id. at 581.
5 Id. at 582. As Professor Lyon describes, the distinction between these terms "is important
because although the two groups overlap numerically, personally, and politically, they are
not co-terminous ....[I]mmigrants who are unauthorized to work are not all undocumented
and those who are undocumented did not all enter the country illegally." And there are
many undocumented immigrants who do not work. Id. Professor Lyon prefers these terms
because they are commonly used, relatively uncontroversial, "accurately convey the legal
situation of the groups described," and create a meaningful distinction. Id.
6
See
JEFFREY S. PASSEL, PEW HISPANIC CTR., UNAUTHORIZED MIGRANTS:
CHARACTERISTICS
NUMBERS AND
5-6 (2005), available at http://pewhispanic.org/files/reports/46.pdf [here-
inafter PASSEL, NUMBERS AND CHARACTERISTICS] (determining that the number of undocumented immigrants is about ten million as of March 2004, increasing at a rate between
700,000 and 750,000 annually since 1995).
7 CTR.
FOR
AM.
PROGRESS,
DON'T
ABANDON
COMPREHENSIVE
IMMIGRATION
REFORM
(2006), http://www.americanprogress.org/issues/2006/09/immigration-reformmemo.html
(urging Americans to push Congress to succeed rather than fail at comprehensive immigration reform and recounting the facts rather than the rhetoric on immigration).
8 Howard F. Chang, Liberalized Immigration as Free Trade: Economic Welfare and the
Optimal Immigration Policy, 145 U. PA. L. REV. 1147, 1210-11 (1997).
9 See Pia Orrenius & Madeline Zavodny, Immigration Policy: What are the Consequences
for an Amnesty for Undocumented Immigrants?, 9 GEO. PUB. POL'Y REV. 21, 23 (2004)
(finding that Mexico, the primary source country for undocumented immigrants, accounts
for almost 70% of undocumented immigrants in 2000); B.
SURO, PEW HISPANIC CTR.,
How
MANY UNDOCUMENTED:
LINDSAY LOWELL
&
ROBERTO
THE NUMBERS BEHIND THE U.S.-
6 (2002), available at http://pewhispanic.org/files/reports/6.pdf
(noting that Mexicans have a long history of immigration to the U.S.); JEFFREY S. PASSEL,
MEXICO MIGRATION TALKS
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[Vol. 7:736
mented immigrants also originate from Latin America (24%), Asia (9%), and
Europe and Canada (6% combined).1 0 The growing hostile reaction to immigration seems to be fueled by the rise in the number of immigrants of color.
Deliberate race-based exclusion has existed in America since its inception."
Despite progress, pervasive and persistent racism continues to be a significant
national tragedy.
Racism is the belief that racial differences produce an inherent superiority
of a particular race. Racists believe that members of the "in-race" possess
goodness and worth simply because of their race. Members of the "out-race"
suffer a deficiency and corruptness that can never be remedied. Therefore, the
ultimate logic of racism is genocide.12
The Holocaust is a horrific testament to this truth. Survivors of the Holocaust speak loudly and uniformly of one commandment: Never again: bear
witness to injustice, racism, and hate and do what is necessary to prevent them.
As Dr. Reverend Martin Luther King, Jr. proclaimed during the civil rights
movement, "[i]njustice anywhere is a threat to justice everywhere .
"..."13
"To
cure injustices, you must expose them before the light of human conscience and
the bar of public opinion ....
Survivors of the Holocaust feel a duty to bear witness for the dead and the
living so that future generations are not deprived of the lessons of the past or
ever have to suffer it as their future. 5 The American people and their reprePEW HISPANIC CTR., ESTIMATES OF THE SIZE AND CHARACTERISTICS OF THE UNDOCUMENTED
POPULATION 1 (2005), available at http://pewhispanic.org/files/reports/44.pdf [hereinafter
(discovering that the number of undocumented immigrants from Mexico is 5.9 million or 57% of the aggregate number as of March 2004, a percentage that has
remained constant for the last decade).
10 PASSEL, ESTIMATES, supra note 9, at 2; see also LOWELL & SURO, supra note 9, at 6.
l1 As a nation, we began by declaring that "all men are created equal." We now
practically read it "all men are created equal, except negroes." When the KnowNothings get control, it will read "all men are created equal, except negroes, and
foreigners, and Catholics." When it comes to this I should prefer emigrating to some
country where they make no preten[s]e of loving liberty... where despotism can be
taken pure, and without the base alloy of hypocr[isy].
Letter from Abraham Lincoln to Joshua Speed (Aug. 24, 1855), in BORN FREE AND EQUAL:
PASSEL, ESTIMATES]
THE STORY OF LOYAL JAPANESE
AMERICANS
MANZANAR RELOCATION
CENTER,
INYO
COUNTY, CALIFORNIA 9 (2001); see also KEVIN R. JOHNSON, THE "HUDDLED MASSES"
MYTH: IMMIGRATION AND CIVIL RIGHTS 16- 20 (2004) (describing the tragic history of
racial exclusion in U.S. immigration laws).
12 See MARTIN LUTHER KING, JR., WHERE Do WE Go FROM HERE: CHAOS OR COMMUNITY? 70 (1967) (finding that in Western history, racists have used segregation, isolation,
subordination, and deprivation as a substitute for the logical limit of extermination of the
"out-races").
13 Letter from Martin Luther King, Jr. to Fellow Clergymen (April 16, 1963), available at
http://www.stanford.edu/group/King/frequentdocs/birmingham.pdf.
THE MAKING OF A MIND 244 (1982) (quoting from Dr. King's 1965 interview with PLAYBOY magazine).
15 Elie Wiesel, winner of the Presidential Medal of Freedom, the United States of America
Congressional Gold Medal, the French Legion of Honor, the Nobel Peace Prize, and survivor
of the Holocaust, has lived his commitment to forever "bear witness" to the unspeakable
atrocities of the Holocaust. Professor Weisel's life has been "that of a witness who believes
he has a moral obligation to try to prevent the enemy from enjoying one last victory by
allowing his crimes to be erased from human memory." ELIE WIESEL, NIGHT Viii (Hill and
Wang, 2006).
14 JOHN J. ANSBRO, MARTIN LUTHER KING, JR.:
Summer 2007]
BEARING WITNESS
sentatives in Congress are wrestling to fix our broken immigration system. In
the process, we must learn from the past and not repeat this country's tragic
historical mistakes.
"The shameful treatment of Chinese immigrants by federal, state, and
local governments (as well as by the public at large) in the 1800s represents a
bitter underside to U.S. history."' 6 In the late 1930s, President Roosevelt
denied critical immigration opportunities for hundreds of thousands of Jews. 7
In 1942, he authorized the imprisonment of almost 120,000 people of Japanese
ancestry, including more than 73,000 American citizens, in "permanent relocation centers."' 8 A year later, President Roosevelt pronounced: "Americanism
is not, and never was, a matter of race or ancestry."' 9 Therefore, American
institutions, policies, and actions should not be based upon race or ancestry.
But they are. U.S. immigration, welfare, and tax systems, among others,
have evolved from invidious race-based policies that have resulted in discriminatory rules leading to irrational actions. Not that many years ago, Hitler's
obsession with the supremacy of an Aryan master race, the central and pervasive theme of Nazism, also led to race-based policies and actions. Hitler used
spellbinding magnetism and simple propaganda to play on the sympathies and
fears of mass audiences, uniting them behind an urgent, hysterical, struggle
against an evil enemy.
My ancestors were the evil enemy who escaped the lethal wrath of the
Nazis through the narrow window of open-door, U.S. immigration policy.
16 JOHNSON, supra note 11, at 17. In his insightful, scholarly, yet accessible book on U.S.
immigration and civil rights, Professor Johnson demonstrates that the poem inscribed on the
Statute of Liberty, "The New Colossus," while descriptive of much of the history of U.S.
immigration, is inconsistent with the shameful treatment of "those categories of immigrants
who share common characteristics with groups that are disfavored in this country." Id. at 2.
Professor Johnson concludes that "those who are truly committed to racial justice in the
United States cannot ignore the treatment of immigrants." Id. at 12.
17 While the United States received about 100,000 Jewish immigrants until 1939, from 1933
until 1943 there were over 400,000 unfilled immigration quotas from countries subject to
Hitler's persecution.
MILTON MELTZER, NEVER TO FORGET:
THE JEWS OF THE HOLOCAUST
45 (1976). See also Daniel J. Steinbock, Refuge and Resistance: Casablanca'sLessons for
Refugee Law, 7 GEO. IMMIGR. L.J. 649, 678 (1993) (stating that social conditions in the
United States between 1938 and 1941 "included a substantial amount of ...anti-Semitism").
Other countries denied entry to hundreds of thousands of Jews as well, including Cuba when
the government refused to honor entry to 930 Jews onboard the MS St. Louis. As the ship
sat in Havana harbor within yards of the shore, a bribe of $1,000,000 was solicited, but could
not be raised within the twenty-four-hour deadline. Colombia, Chile, Paraguay, Argentina,
and the United States either ignored requests for entry or explicitly denied it. Eventually, the
MS St. Louis turned around and let its passengers off in Belgium, the Netherlands, England,
and France. Most of these passengers, other than the 288 who disembarked in England, were
murdered in the Holocaust.
TORY OF THE HOLOCAUST As
MICHAEL BERENBAUM,
THE WORLD MUST KNOW:
THE
His-
TOLD IN THE UNITED STATES HOLOCAUST MEMORIAL MUSEUM
53-54 (1993) (describing the tragic journey of the MS St. Louis).
18 On February 19, 1942, President Franklin D. Roosevelt signed Executive Order No. 9066
and authorized the removal of all Japanese from the west coast and their confinement in
relocation camps. Prejudice against the Japanese was based on the idea that race, not citizenship, determined loyalty to the United States. The U.S. Supreme Court upheld this
internment in its opinion in Korematsu v. United States, 323 U.S. 214 (1944).
19 DANIEL S. DAVIS, BEHIND BARBED WIRE 100-01 (1982) (quoting President Franklin D.
Roosevelt in early 1943).
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[Vol. 7:736
Today when I hear broad proclamations of misinformation casting "illegal
aliens"2 as the scapegoat for all of the nation's problems, I fear the intoxicating power of simple propaganda. I fear the strength of misguided frustration
and hate. I fear the inability of the masses to see through the mendacity
because of unjustifiable complexity and lack of transparency in our institutions.
Because of the lessons I have learned from the brave survivors of unspeakable past atrocities, I know I cannot be a bystander. As the granddaughter and
great-granddaughter of persecuted immigrants, I must confront and alleviate
threats to human dignity, social justice, and civil rights everywhere. I must
discover the truth and explain it precisely, pensively, patiently and with
passion.
21
I must bear witness.
II.
U.S.
SOCIAL WELFARE POLICY TOWARD UNDOCUMENTED IMMIGRANTS:
"THE LESS THAN UNDESERVING" WORKING POOR
A.
InstitutionalizedRacism
American public policy has been forever defined by and institutionalized
according to racial and ethnic hierarchies. For centuries, through systemic
racial and ethnic inequality, America has abandoned people of color "to murder
and mayhem in the streets, to substandard schools, to dilapidated housing, to
inadequate health care, to a pervasive sense of hopelessness. ' 22 In the early
1900s, termed the "Progressive Era," U.S. and state governments established an
unprecedented number of legislative and administrative actions intended to protect the social and economic rights of the "deserving" poor, that is, the White
poor.2 3 These actions were wrought with regressive civil rights policies that
reflected and reinforced the subordinated status of people of color. The modern
U.S. welfare state has evolved from this social and political landscape. 24
supra note 11, at 156-57 (describing the term "illegal alien" as "the most
damning terminology for noncitizens").
21 "The survivor must be a witness. He doesn't have the right to hide behind a faqade of
false modesty. The easy way would be just to say nothing - but it's been a long time since
20 JOHNSON,
he took the easy way."
ELIE WIESEL, AFTER THE DARKNESS:
RELECTIONS ON THE HOLO-
CAUST 9 (2002) (proving again the importance of bearing witness). With undeniable irony,
on February 1, 2007, at a peace conference in San Francisco, Professor Wiesel, now a seventy-eight-year-old survivor, was assaulted by a young Holocaust denier. Matthai Chakko
Kuruvila, San Francisco: N.J. Man Sought in Wiesel Attack., FEB. 17, 2007, at B2. See also
Press Release, Statement on the Attack of Elie Wiesel, Anti-Defamation League, Feb. 15,
2007, http://www.adl.org/PresRele/ASUS_12/4978_83.htm (noting that "[b]earing witness
to the Holocaust, Elie Wiesel, eloquently writes, speaks and teaches about the inhumanity of
man and is the moral voice against it ever happening again, to anyone").
22 Tyrone A. Forman & Amanda E. Lewis, Racial Apathy and Hurricane Katrina: The
Social Anatomy of Prejudice in the Post-Civil Rights Era, 3 Du Bois REV. 175, 176 (2006)
(quoting Illinois Senator Barack Obama).
23
See
DEBORAH E. WARD, THE WHITE WELFARE STATE:
THE RACIALIZATION OF U.S.
14-16 (2005).
24 See generally id. Ward's book provides "a powerful array of documentary and statistical
evidence to reveal the mechanisms, centrality, and deep historical continuity of racial exclusion in modem 'welfare' provision in the United States." Alice O'Connor, Praise for the
Book, http://www.press.umich.edu/titleDetailPraise.do?id=22210 (last visited June 4, 2007).
WELFARE POLICY
Summer 2007]
B.
BEARING WITNESS
The Racialization and Reconstruction of Welfare
From their inception, government assistance programs sought "to impose
White, middle-class norms on a population deemed worthy of assistance only if
it embraced the superiority of this White middle-class culture." 25 From 1911
through 1932, state-based mothers' pension laws and aid programs preserved
and protected White, middle-class women and their children, intentionally
excluding African-Americans, non-White immigrants and the poor.
In 1935, Franklin D. Roosevelt federalized this institutionalized racism
when he signed the Social Security Act into law and established a bifurcated
U.S. welfare state: a national "social insurance" program for worthy retired
workers and their dependents and public assistance programs for the remainder.2 6 Deemed "deserving," the Act did not subject the former beneficiaries to
ANY exclusionary testing. And the latter remnants of society were subject to
race-based scrutiny and means-testing to prove their need and their worthiness. 27 With the addition of Survivor's Insurance in 1939, White widows and
their precious children once again gained worthy status: intentionally segregated from the unfit and unworthy welfare recipients of color and added to the
protection of the Social Security "insurance" system.2 8
As it became more and more difficult to exclude people of color from
government assistance, the public image of "welfare" became increasingly negative and sated with racist stereotypes. 29 The portrait of the worthy and unfortunate respectable White widow and sympathetic fatherless children was
replaced with the "welfare queen:" a Black, irresponsible, lazy, drug-addict
mother who produced children out of wedlock for decades solely for the
increased copious cash flow from the over-taxed taxpayers. 3 °
Empirical evidence demonstrates that these stereotypes are grossly inaccurate and a 1962 study found that no outright cases of welfare fraud have been
discovered.3 1 Indeed, "African Americans have never represented a majority
of those receiving welfare" despite their disproportionate poverty.3 2 However,
once people of color gained access to government assistance, the White public
and media spun welfare into an overwhelming economic drain on society costing all Americans their limited financial resources. The intentional racialization of welfare accomplished the goal of its certain demise.
25 WARD, supra note 23, at 54. See also Joel F. Handler, "Ending Welfare As We Know
It": The Win/Win Spin or the Stench of Victory, 5 J. GENDER RACE & JUST. 131, 134 (2001)
("The cornerstone of U.S. welfare policy has always been to separate the 'deserving' poor
from the 'undeserving.'"); Angela Onwuachi-Willig, The Return of the Ring: Welfare
Reform's Marriage Cure as the Revival of Post-Bellum Control, 93 CAL. L. REV. 1647,
1665-67 (noting that Americans were supportive of early welfare programs because the primary beneficiaries were "deserving" pitiable White widows who needed to care for their
white fatherless children).
26 WARD, supra note 23, at 98-99.
27 Id. at 99-130 (describing the evolution of mothers' pensions through the New Deal).
28 See id. at 126; Onwuachi-Willig, supra note 25, at 1667-68.
29 Onwuachi-Willig, supra note 25, at 1668-73.
30 Id.
31 ROBERT LIEBERMAN,
STATE 161-62 (1998).
32 WARD, supra note
SHIFTING THE COLOR LINE:
23, at 9.
RACE AND THE AMERICAN WELFARE
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[Vol. 7:736
A Republican Congress passed the Personal Responsibility and Work
Opportunity Reconciliation Act of 1996 (PRWORA). 3 3 President Clinton,
responding to an incensed and enraged White public, cut off the "free ride" for
"undeserving welfare queens," by signing the PRWORA into law. With the
"end of welfare as we knew it," work became the primary "new" remedy for
poverty. Nevertheless, race remains the basis upon which the government provides the effective tools to secure work, such as education, training, and child
care.
Since the implementation of the welfare-to-work program, studies have
demonstrated that White welfare recipients are more likely than other ethnic
groups to be encouraged to get an education and receive child care subsidies
and less likely to be sanctioned for welfare policy violations. 34 These studies
also indicate that White women are more likely to receive benefits for children
born out of wedlock. 35 Today "[w]ell over 30 million Americans live below
the federal poverty line, and while a majority of the poor are White, African
Americans and Latinos constitute approximately twice the proportion of the
country's poor as they do of the population overall." 36 With the increasing
population of undocumented immigrants in the United States, American institutions have devised a new exclusionary category of "undeserving poor" who
37
even are treated even less favorably: "The Less Than Undeserving Poor."
C.
Welcome to America: Those With Gold Come Through Our Door3 8
Despite the warm welcome to the poor inscribed on the Statue of Liberty,
being poor in America today is a life fraught with daily insurmountable challenges. 39 Forever in fear of abuse of its social welfare systems, America has
denied entry to the poor since colonial times. 4 ° Even today the "public charge
exclusion" accounts for most initial substantive State Department visa denials. 4 Immigrants who enter legally, but later become public charges, are subject to deportation. However, because of aggressive use of the public charge
exclusion and the chilling effect on seeking financial assistance, the U.S. has
not deported many poor immigrants.42
33 Personal Responsibility and Work Opportunity Reconciliation Act of 1996, Pub. L. No.
104-193, 110 Stat. 2105 (codified as amended at 8 U.S.C. § 1612 (2000)). Immigrant eligibility for food stamps is restored by 8 U.S.C. § 1612(a)(2)(D)(ii).
14 WARD,
supra note 23, at 145.
Id.
36 Forman & Lewis, supra note 22, at 176.
37 See JOHNSON, supra note 11, at 93-96.
31 "Give me your tired, your poor, Your huddled masses yearning to breathe free, The
wretched refuse of your teeming shore. Send these, the homeless, tempest-tossed to me. I
lift my lamp beside the golden door." Emma Lazarus, The New Colossus, in THE POEMS OF
EMMA LAZARUS, Vol. 1, at 2 (1889).
39 For a captivating description of the working poor in America today, see DAVID K.
SHIPLER, THE WORKING POOR: INVISIBLE IN AMERICA (2001).
35
40 JOHNSON,
supra note l1,
at 93-96.
41 Id. at 97 (recounting that 90% of initial visa denials in 1998 were due to the "public
charge exclusion").
42 Id. at 91-93.
Summer 2007]
BEARING WITNESS
Poor lawful immigrants, as the "undeserving" poor in America, must try to
survive with limited public benefits and the persistent fear of losing their lawful
status because they are a "public charge." Undocumented immigrant families,
"the less than undeserving" poor, are ineligible for most public assistance programs, including meaningful tax relief, and therefore pay federal, state, and
local income, property, excise, and sales taxes at exceptionally high effective
marginal tax rates.
D. Welfare Relief Under the Tax Code for Most of the Working Poor in
America
Similar to U.S. citizens, undocumented immigrant families are subject to
federal, state, and local income, property, excise, and payroll taxes. However,
consistent with U.S. welfare policy, the federal income tax system is designed
to encourage work by providing that poverty level working families do not pay
taxes.4 3 The statutes deny this relief to undocumented immigrant families. 4
1. Anti-poverty Relief for Certain Working Poor Families Under the
EITC
In 1972, then-Governor Ronald Reagan, testifying before Congress
regarding a workfare approach to government assistance, "suggested that the
federal government should exempt low income families from income taxes and
give them a rebate for their Social Security taxes." 45 Several years later, Senator Russell Long, the conservative Democrat chairman of the Senate Finance
Committee, and Congressman Al Ullman, the moderate chairman of the House
Ways and Means Committee, were able to package the idea in a refundable tax
credit and garner liberal support for the Earned Income Tax Credit (EITC).4 6
Since it was developed and established in 1975 by conservative forces, the
EITC has enjoyed strong support across the entire political spectrum for
encouraging work over welfare.4 7
The EITC is the largest and most successful anti-poverty program in the
United States for working poor families. "Research strongly confirms that the
EITC has played a critical role in bringing more single mothers into the
41
See
SAUL
D.
HOFFMAN & LAURENCE S. SEIDMAN, HELPING WORKING FAMILIES: THE
1-4 (2003); William Safire, The 25% Solution, N.Y. TIMES,
EARNED INCOME TAX CREDIT
Apr. 20, 1995, at A19 (commenting that most taxpayers believe that the poor should not pay
any taxes, the middlers something, and the rich the highest percentage).
4 For purposes of this Essay a family residing in the United States long enough to be
subject to U.S. federal income taxes as a "resident alien" and in which not every member has
a valid Social Security number will be described as an "undocumented immigrant family."
" See HOFFMAN & SEIDMAN, supra note 43, at 12.
46 Id. at 11-16 (recounting the conservative history and liberal support of the EITC).
41 Id. at 14; ROBERT GREENSTEIN, CTR. ON BUDGET & POLICY PRIORITIES, THE EARNED
BOOSTING EMPLOYMENT, AIDING THE WORKING POOR 1 (2005), available at http://www.cbpp.org/7-19-05eic.pdf (describing the broad base of support for the
EITC, including conservative economists and Presidents George H.W. Bush and William J.
Clinton); Dorothy A. Brown, The Tax Treatment of Children: Separate But Unequal, 54
EMORY L.J. 755, 801 (2005) (President Clinton expanded the EITC in 1993 and commented
that the EITC "reward[s] work over welfare ....
Now that's real welfare reform.").
INCOME TAX CREDIT:
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[Vol. 7:736
workforce. '4 8 The EITC encourages work and lifts millions of taxpayers out of
poverty, including almost three million children each year, more than any other
social program.49 Without
the EITC, the number of children living in poverty
0
would increase by 25%.5
The EITC is a refundable tax credit that provides cash refunds of up to
$4,716 (for 2007) to ensure that working poor families pay no taxes. 5 While
designed to offset the burden of Social Security payroll 'taxes, the EITC in some
cases provides a meaningful wage subsidy for low-income working families.52
The EITC provides critical cash refunds "for basic necessities like housing,
utilities, food, and basic household appliances. '53 More than twenty-one million taxpayers, almost 17% of all taxpayers, received average EITCs of $1,788,
or in excess of $38 billion in 2003." 4
a.
Qualifying for the EITC
Throughout its thirty-plus year history, the EITC has encouraged lowincome families to work.55 Accordingly, to qualify for the EITC, an individual
and her spouse, if married, must have earned income within certain lowerearned income ranges.5 6 The EITC and the earned income ranges are indexed
for inflation annually and vary meaningfully with the number of qualifying
children. 57 For tax year 2007, eligible individuals with two or more children
may claim the maximum EITC of $4,716 for earned income or adjusted gross
income (AGI) levels of $11,790 to $15,390 ($17,390 for married filing jointly).
The EITC phases out completely at $37,783 ($39,783 for married filing jointly)
of the greater of earned income or AGI. 58 Because the EITC is targeted for
families, the maximum EITC benefits drop for eligible individuals with one
INST., THE EARNED INCOME TAX CREDIT AT AGE 30:
WHAT WE KNOW 14 (2006), available at http://www3.brookings.edu/metro/pubs/
20060209_Holt.pdf (citing studies that find that the larger EITC was responsible for 84% of
the difference in the employment rate increases between one-child and multi-child families;
60% of the increase in single mothers' work between 1984 and 1996 and 34% of the increase
in employment among single mothers between 1993 and 1999).
49 Id. at 13 (stating the 2003 statistics of 4.4 million lifted out of poverty, including 2.4
million children).
50 Id.
48 STEVE HOLT, THE BROOKINGS
51 I.R.C. § 32 (2000).
52 See HOFFMAN & SEIDMAN, supra note 43, at 11; GREENSTEIN, supra note 47, at 1-3
(describing EITC basics and reporting that EITC expansions were responsible for more than
one-half of the large increase in employment among single mothers between 1984 and
1996).
53 GREENSTEIN, supra note 47, at 4. See also SHIPLER, supra note 39, at 13-14 (describing
how the working poor use their EITC benefits to buy furniture, homes, and pay bills).
5' ALAN BERUBE, THE BROOKINGS INST., THE NEW SAFETY NET:
HOW THE TAX CODE
HELPED Low-INCOME WORKING FAMILIES DURING THE EARLY 2000s 1-2 (2006), available
at http://www3.brookings.edu/metro/pubs/eitc/20060209-newsafety.pdf.
51 See HOFFMAN & SEIDMAN, supra note 43, at I1-16 (describing the history of the EITC's
design and evolution).
56 I.R.C. § 32(a)(1) (2000).
57 Id. § 32(b)-().
58 Id.
Summer 2007]
BEARING WITNESS
qualifying child ($2,853) or no qualifying children ($428). 59 And married taxpayers, with or without children, who file their tax returns separately will not
receive any EITC.6 ° The EITC is not intended to benefit low wage earners
with above average investments so eligible individuals cannot have investment
income in excess of $2,900 per year.61
If an eligible individual does not have a qualifying child, she must satisfy
several additional conditions. 62 She must: (1) have a principal place of abode
in the United States for more than one-half of the tax year; (2) not be a dependent; and (3) be at least age twenty-five, but under age sixty-five (if married,
only one spouse must satisfy the age requirement) as of the close of the tax
year. 63
Eligible individuals with one or more qualifying children meet the criteria
for significantly greater EITC benefits than those without any qualifying children.64 A qualifying child is defined under the uniform definition of a child for
purposes of claiming a dependent. 65 Therefore, if a taxpayer has a dependent
child, grandchild, brother, sister, niece, or nephew, the dependent likely will
satisfy the requirements for a qualifying child under the EITC.6 6 However, this
is not the case for certain immigrant families.
b.
Congress Limits EITC Relieffor Authorized Work
In 1996, Congress enacted and President Clinton signed into law
PRWORA, which included unprecedented restrictions on federal benefits for
many immigrants. 6 ' Among the long list of benefit restrictions, Congress
decided that "individuals who are not authorized to work in the United States"
59 Rev. Proc. 2006-53, 2006-48 I.R.B. 996, § 2.07 (Nov. 27, 2006) (setting forth earned
income credit amounts for 2007); I.R.C. § 32(a)(2).
60 See I.R.C. § 32(d) (setting forth the requirement that married taxpayers must file a joint
tax return to qualify for the credit). Moreover, nonresident aliens do not qualify for the
credit unless they are married to a U.S. citizen or resident alien and they elect to have their
worldwide income subject to U.S. income tax. See id. § 32(c)(1)(D) (providing that a nonresident alien may qualify if she will be treated as a resident alien for tax purposes due to an
election under Section 6013(g) or (h)).
61 See id. § 32(i) (describing the disqualifying investment income as interest (taxable and
tax-exempt), dividends, net capital gains, net rents, net royalties, and net passive income).
62 Id. § 32(c)(1)(A).
63 Id. § 32(c)(1)(A)(ii).
6 See Rev. Proc. 2006-53, 2006-48 I.R.B. 996, § 2.07.
65 I.R.C. § 32(c)(3) (referring to section 152(c) to define a "qualifying child"). A "qualifying child" is generally defined under Section 152(c) of the Internal Revenue Code for this
purpose as a child, grandchild, brother, sister, niece, or nephew who lives with the taxpayer
for more than one-half of the tax year and is under age nineteen (twenty-four if a full-time
student). In addition to satisfying the requirements under a uniform definition of a child, the
dependent must live in United States for more than six months. Id. § 32(c)(3).
66 The additional requirements for purposes of the EITC include that the "qualifying child"
must live with the taxpayer in the United States and that the "qualifying child" must have a
Social Security number. Id.
67 Tanya Broder, Immigrant Eligibilityfor Public Benefits, in IMMIGRATION AND NATIONALITY LAW HANDBOOK, 2005-06 EDITION 759 (Gregory P. Adam et al. eds., Am. Immigration
Lawyers Ass'n 2005) (describing impact of The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 and the Illegal Immigration Reform and Immigrant Responsibility Act of 1996).
NEVADA LAW JOURNAL
[Vol. 7:736
should be denied EITC benefits. 68 To accomplish this goal, Congress amended
the Internal Revenue Code ("Code") to require that any taxpayer (and, if married, her spouse) and each qualified child must provide a valid Social Security
number ("SSN") (issued to individuals authorized to work in the United States)
to receive any EITC benefits. 69
SSNs have been issued to workers since the implementation of the 1935
Social Security Act.70 The initial purpose of the number was to provide
employers and the U.S. government with a means to report or track Social
Security earnings for purposes of payroll tax and retirement benefits calculations. 7' In the 1960s, computerization caused the Internal Revenue Service
("IRS") and private businesses to rely on SSNs as a method of accumulating,
sorting, and tracking information.72 Until the early 1980s, the government
issued Social Security cards to unauthorized workers and only kept internal
records regarding their status.73 Beginning in 1982, Social Security cards
issued to unauthorized workers were marked "Not Valid for Employment," and
temporarily authorized workers received cards marked "Valid Only With INS
Authorization." 74
In an effort to stop employers from hiring unauthorized workers, Congress
enacted the Immigration Reform and Control Act of 1986. 7 ' This Act, among
other things, required employers to have all new employees prove their identity
and work authorization with specific documents.7 6 Congress listed the Social
Security card as an acceptable document evidencing proof of work authorization. 77 As a result of this requirement, there has been widespread use of counterfeit Social Security cards among unauthorized workers, making "it more
common and easier than ever
for [unauthorized] workers to enter and function
78
in the U.S. labor market."
68 STAFF OF J. COMM. ON TAXATION,
4
104TH CONG., GENERAL EXPLANATION OF TAX LEGIS-
LATION ENACTED IN THE 10 TH CONGRESS
394 (Comm. Print 1996).
69 Personal Responsibility and Work Opportunity Reconciliation Act of 1996, Pub. L. No.
104-193, 110 Stat. 2276-77 (codified as amended at 8 U.S.C. § 1612 (2000)); I.R.C
§ 32(c)(1)(E), (in); Working Families Tax Relief Act of 2004, Pub. L. No. 108-311, § 205,
118 Stat. 1169, 1176 (2004); I.R.C. § 32(c), (in) (renumbering the clauses added by the 1996
Act). Specifically, the Code requires a SSN that is issued for reasons other than to apply for
or receive benefits fully or partially funded with federal funds. See id. § 32(m) (finding that
for this purpose the Taxpayer Identification Number ("TIN") is an SSN issued pursuant to
provisions other than "clause (II) (or that portion of clause (III) that relates to clause (II)) of
section 205(c)(2)(B)(i) of the Social Security Act").
70 Paula N. Singer & Linda Dodd-Major, Identification Numbers and U.S. Government
Compliance Initiatives, 104 TAX NOTES 1429, at 1429-30 (Sept. 20, 2004).
71 Id.
72 Id. at 1431.
73 Id.
71 Id. (noting that with the replacement of the INS with the Department of Homeland Security the new annotation is "Valid for Work Only with DHS Authorization").
71 Id. See also Immigration Reform and Control Act of 1986, Pub. L. No. 99-603, § 10 1(a),
100 Stat. 3360-72; 8 U.S.C. § 1324(a) (2000) (setting forth matters related to employment of
aliens).
76 Singer & Dodd-Major, supra note 70, at 1431.
77 Id.
71 Id. See also Lyon, supra note 3, at 590 (finding that purchased or borrowed SSNs are
easily obtained throughout the country and employers look the other way).
Summer 20071
BEARING WITNESS
2. The Ban on EITC Benefits for Undocumented Working Poor
Families
Undocumented immigrants are not authorized to work in the United States
and, therefore, have not been eligible for a SSN since 1996.' 9 In lieu of a SSN,
undocumented immigrants must apply for and use an Individual Taxpayer Identification Number ("ITIN") for all their tax filings.8" Consequently, undocumented immigrant families cannot qualify for any EITC benefits.
While this may seem consistent with the denial of virtually all government
assistance for undocumented immigrants, it is not. The SSN requirement is
poorly targeted and is both overbroad and under-inclusive. This requirement
denies EITC benefits for certain hard-working, poor, undocumented immigrant
families who are legally working and present in the U.S. The SSN requirement
also provides EITC benefits for certain unauthorized work. The requirement
that every member of the household have a SSN (authorizing work) is ill-conceived because it is inconsistent with Congress' stated intent of only providing
EITC benefits for authorized work.
a. The SSN Requirement Denies EITC Benefits for Certain
Immigrant Families in Which Every Member Is Legally
Working and Present in the United States
The requirement is too restrictive because it excludes families in which
every adult is legally working and present in the United States from EITC benefits. Two legally present and working parents with a child without a SSN
cannot receive any EITC benefits even if the child is not working. The Code
precludes any EITC benefits for this obviously legally working and present
family, including the lesser amount of EITC benefits available for eligible individuals without a qualifying child.8 ' However, if the same family has at least
'9 See Singer & Dodd-Major, supra note 70, at 1430, 1432.
80 The ITIN is "a nine-digit number resembling an SSN but starting with the number '9' and
having the number '7' or '8' as the fourth digit." Id. at 1432. See Treas. Reg. § 301.61091(a) (2006). As late as 1996, the Social Security Administration ("SSA") began limiting the
individuals eligible to receive SSNs to: U.S. citizens, alien individuals legally admitted for
permanent residence, and alien individuals admitted under another immigration category
authorized for employment in the United States. Singer & Dodd-Major, supra note 70, at
1432. Qualifying taxpayers must apply for an ITIN using Form W-7, Application for Individual Taxpayer Identification Number, which requires taxpayer information, including the
individual's name, address, foreign tax identification number (if any), and specific reason for
obtaining the ITIN. Treas. Reg. § 301.6109-1(d)(3). In addition, the IRS may prescribe that
applicants provide documentary evidence to establish their alien status and identity. Id.
Acceptable documentary evidence for this purpose may include items such as an original (or
a certified copy of the original) passport, driver's license, birth certificate, identity card, or
immigration documentation. Id. Qualifying individuals must apply for and use their unique
ITIN on all their tax filings after December 31, 1996. Id. § 301.6109-1(j). The ITINs are
"for tax purposes only and don't affect immigration status, authorize work in the U.S. or
provide eligibility for Social Security benefits .... " I.R.S. News Release IR-2003-49 (Apr.
10, 2003).
81 This hypothetical couple could be visiting faculty members admitted to the United States
temporarily for authorized work. Each of these individuals would qualify for SSNs. However, the couple's minor child would not be authorized to work and, therefore, would not
qualify for a SSN. The couple would be required to file for an ITIN for their dependent
NEVADA LAW JOURNAL
[Vol. 7:736
one child with a SSN and one or more children without a SSN, but with an
ITIN, the family can qualify for EITC benefits for a married couple with one
qualifying child.82
The requirement also denies EITC benefits to any U.S. citizen or authorized worker whose nonworking spouse has a valid ITIN, but no SSN. 83 The
spouse could be legally present in the United States or a resident of another
country (a nonresident alien for tax purposes) who elects to subject her otherwise nontaxable income to U.S. income tax by filing with her U.S. citizen or
resident spouse. Even if the couple has one or more qualifying children who
are U.S. citizens with SSNs, this legally present and working undocumented
immigrant family will not qualify for any EITC benefits. 84
If the family decides to file a married filing separate return so that all
individuals on the EITC tax return have SSNs, they will not qualify for any
EITC benefits. Married taxpayers cannot qualify for the EITC with a married
filing separate tax return.85 Only if the couple ends their marriage or never
enters into marriage will crucial EITC benefits be available. 86 If, within the
statute of limitations period, the spouse and/or child with an ITIN obtains a
SSN, the family can amend the married filing separately tax returns and file a
joint return. However, if either married filing separate return becomes the subject of certain tax controversies, they cannot amend the returns and file jointly
and the opportunity for any EITC during those tax years is lost.87
b. The SSN Requirement Does Not Preclude Workers Who Are
Unauthorizedfrom Receiving EITC Benefits
The SSN requirement also permits families who have members that are
working in the United States without authorization and without current documents to receive EITC benefits. For example, a taxpayer with a SSN that
authorized work when issued, but that is no longer valid for employment, will
qualify for EITC benefits. The provision requiring a SSN on the tax return
child for tax filing purposes. As a result, the couple would not qualify for any EITC benefits, including EITC benefits for taxpayers without any qualifying children. See I.R.C.
§ 32(c)(1)(G) (2000).
82 If we assume the same couple gives birth to a child while they are residing in the United
States, the newborn would be a U.S. citizen and would qualify for a SSN. As a result, the
couple would have one qualifying child and one non-qualifying child under the EITC.
Given these circumstances, the couple could qualify for EITC benefits for a married couple
with one qualifying child. See id.; I.R.C. § 32(m). If the same family has two children with
SSNs and other children without SSNs, the family can qualify for the maximum amount of
EITC benefits for a married couple with two or more qualifying children. Id.
83 I.R.C. § 32(c)(l)(E)(ii), (c)(1)(F).
84 See id.
85 See id. § 32(d).
86 This is not only inconsistent with Congress' targeted EITC recipients, but also inconsistent with the strong push for marriage as a cure for poverty. See generally Onwuachi-Willig,
supra note 25, at 1660 (demonstrating that the current administration's policy of promoting
marriage as a cure for poverty shifts the burden of poverty from the government to the
welfare recipient- analogous to the government's use of "marriage to financially and socially
domesticate newly freed Blacks to ensure that the white public faced minimal responsibility
for former slavers' economic security").
87 See I.R.C. § 6013(b)(2)(B)-(D).
Summer 2007]
BEARING WITNESS
does not require that the SSN be currently valid for work or residence in the
United States. 88 Literally, the provision only requires that the SSN not be
issued to secure federal benefits. 89 Therefore, SSNs issued temporarily for
work which are no longer valid, or SSNs issued to unauthorized workers before
1982 to secure state or local benefits are valid for EITC benefits, while SSNs
initially issued to secure federal benefits but that are now work authorized are
not.90 The SSN requirement as stated and enforced does not assure that only
authorized work qualifies for EITC benefits.
Ironically, the government permits EITC benefits to families retroactively
for tax years in which they were working and/or present in the United States
without government authorization. 9 ' If unauthorized workers, their spouses, or
qualifying children obtain SSNs after a tax return is filed, the return can be
amended merely to add the SSNs and retroactively claim EITC benefits. 92 The
IRS has ruled that EITC benefits are retroactively available as long as the statute of limitations has not lapsed.9 3 Therefore, once all members of the family
have SSNs, EITC benefits are available even if during the tax year at issue no
family members were authorized to work or even be in the United States.9 4
The SSN requirement does not accomplish Congress' stated intention of
denying EITC benefits for unauthorized work. The requirement only calls for a
SSN on the tax return, as filed or as timely amended, for the taxpayer and
spouse, if any, and at least one of any children. The requirement does not
ensure that the work upon which the credit is based be authorized.
In an effort to deny EITC benefits quickly and efficiently to "less than
undeserving" poor working irnrmmigrant families, Congress has devised a poorly
targeted clerical requirement. The SSN requirement categorizes the working
poor in America into two separate groups: those that are holders of SSNs and
those that are holders of ITINs or SSNs issued for federal benefits. The result
is separate, unequal, and irrational tax treatment of hard-working poor undocumented immigrant families.9 5
88
See id. § 32(m).
89 Id. (emphasis added).
90 Broder, supra note 67, at 775.
91 I.R.S. C. Couns. Adv. Mem. 200028034 (June 9, 2000) (finding that an individual otherwise eligible for the EITC without a valid SSN may claim the EITC on an amended return
with a valid SSN subject to the lapsing of the statute of limitations); I.R.S. C. Couns. Adv.
Mem. 200032013 (May 9, 2000) (finding the same with respect to a taxpayer who is not
authorized to work, but later after becoming authorized obtains a valid SSN); I.R.S. C.
Couns. Adv. Mem. 200126030 (May 15, 2001) (finding the same and noting that the SSN
must be issued for an alien lawfully admitted to the United States and entitled to engage in
U.S. employment).
92 I.R.S. C. Couns. Adv. Mem. 200032013 (May 9, 2000); I.R.S. C. Couns. Adv. Mem.
200126030 (May 15, 2001).
13 I.R.S. C. Couns. Adv. Mem. 200028034 (June 9, 2000).
94 See I.R.S. C. Couns. Adv. Mem. 200032013 (May 9, 2000).
91 See Kristina M. Oven, The Immigrant First As Human: InternationalHuman Rights
Principlesand Catholic DoctrineAs New Moral Guidelinesfor U.S. Immigration Policy, 13
NOTRE DAME J.L. Emrics & PUB. POL'Y 499, 502-05 (1999) (describing anti-immigrant
sentiment and racism resulting in welfare reform because of the perception that undocumented immigrants come to the United States to take advantage of public assistance).
[Vol. 7:736
NEVADA LAW JOURNAL
3. Congress Can and Must Act Immediately to Remedy Its
Unintentional(?)Race-Based Exclusion of Hard-Working Poor
Undocumented Immigrant Familiesfrom Welfare
The denial of critical EITC benefits to undocumented immigrant families
merely because one family member does not have a SSN (even if she is not
working or even present in the United States) is a glaring example of institutionalized xenophobia and racism. Congress could remedy this problem easily,
by requiring that each working individual have a SSN authorizing the work
qualifying the taxpayer for EITC benefits. This simple change would achieve
the clearly-stated goal of only providing federal assistance for authorized work.
This decade-old denial of EITC benefits has created a growing new class of
"undeserving" poor in America: "the less than undeserving" poor. Sadly, it
gets worse.
III.
BEARING THE BURDEN WITHOUT ANY BENEFITS:
UNAUTHORIZED
WORKERS ARE REQUIRED TO PAY PAYROLL TAXES, BUT ARE
NOT ELIGIBLE FOR SOCIAL SECURITY BENEFITS
A. Undocumented Immigrant Working Families Bear a Higher Marginal
Tax Rate Than High Income Households Because of Regressive Social
Security Taxes and No EITC
Unauthorized workers and their employers must each pay Social Security
payroll taxes of 7.65% on all wages for an aggregate tax of 15.3%. "Most
economists believe that the burden of most payroll taxes paid by employers
falls on the employees themselves. 9 6 Therefore, undocumented immigrant
working families likely bear an effective marginal tax rate of at least 15.3%.
High income families will bear a significantly lower effective marginal tax rate
from payroll taxes because their wages above $97,500 (in 2007) and investment
income are not subject to Social Security tax. 9 7 Clearly, payroll taxes are horribly regressive.
"When both income and payroll taxes are considered, the effective marginal tax rates on earned income can be extraordinarily high, especially on lowincome workers with children." 98 "Some of the very highest marginal effective
tax rates are imposed on couples earning around $30,000 a year." 99 Hardworking, low-income families bear the onerous and unjust economic burden of
effective marginal tax rates as high as 45% (and likely even higher if state
sales, excise, property, and income taxes are added into the analysis).
The amount of Social Security taxes paid by unauthorized workers and
their employers has been increasing steadily and is now in the billions of dollars annually. In 2003, the government collected an estimated seven billion
dollars in Social Security and Medicare taxes, or approximately one percent of
96 JONATHAN BARRY FORMAN, MAKING AMERICA WORK
67-68 (The Urban Institute 2006).
9 The Medicare portion of Social Security taxes (1.45% for each the employee and the
employer) is not capped at $97,500 (in 2007) and is assessed on every dollar of wages
without limitation.
98 FORMAN, supra note 96, at 69-70.
99 Id. at 69.
Summer 2007]
BEARING WITNESS
overall revenue, from 7.5 million workers and their employers with mismatched SSNs. l00 This dollar amount has more than tripled in the last decWhile some of the mismatches are due to clerical errors, the majority
ade.'
exist because unauthorized workers do not qualify for SSNs.102
B. Unauthorized Workers and Their Families Do Not Qualify for Critically
Progressive Social Security Benefits
In addition to not qualifying for a SSN or EITC benefits, unauthorized
workers and their families do not qualify for critical Social Security benefits.
Social Security is the largest and most successful social welfare program in the
United States. For more than seventy years, Social Security has provided critical financial benefits to tens of millions of individuals every month. Today,
Social Security provides more than forty-eight million individuals with average
benefits of about $10,500 per year. While not means-tested, Social Security
presently lifts about thirteen million senior citizens and one million children out
of poverty. Without Social Security, almost one-half of all senior citizens
would live in poverty. For 66% of all seniors, Social Security benefits comprise the majority of their income and for almost one-third of all seniors Social
Security benefits comprise 90% or more of their income.
Senior citizens of color are less likely than White senior citizens to receive
Social Security benefits or to have other income from private pensions or
assets. Only 75% of Hispanics age sixty-five or older receive Social Security
benefits. Of the Hispanic seniors receiving Social Security, 76% rely on Social
Security for more than one-half of their retirement income and almost 50% rely
on Social Security for most of their retirement income. Without Social Security benefits, almost one-third of all Hispanic seniors would live in poverty.
While Social Security taxes are terribly regressive, Social Security benefits are surprisingly progressive. The Social Security system is designed to
redistribute meaningful financial resources from high wage earners to lower
wage earners. The redistribution occurs through a very complicated and
opaque benefits formula. The lack of transparency may be one secret to Social
Security's success and its overwhelming public support. Although Social
Security is not means-tested, it is a phenomenally successful, anti-poverty, government assistance program that bears none of the oppressive stigma of welfare. It is a program for the "deserving" poor and, of course, the middle class,
rich, and super rich folks too.
1. How the Social Security Retirement Benefit System Works
Any and all workers over the age of sixty-two generally are entitled to
Social Security retirement benefits if they have worked in covered employment
for at least forty quarters (ten years). A retiree's monthly benefit is based upon
"o See Alan Zarembo, Garment Laborers Say Bush Guest-Worker Plan an Ill Fit, L.A.
Feb. 8, 2004, at Al; see also Singer & Dodd-Major, supra note 70, at 1435 n.9
(reporting $7 billion in Social Security payroll taxes and $56.1 billion in wages in 2001
added to suspense accounts).
lo See Zarembo, supra note 100.
112 See id.; Singer & Dodd-Major, supra note 70, at 1431 (describing proliferation of false
TIMES,
use of SSNs and Social Security cards).
NEVADA LAW JOURNAL
[Vol. 7:736
her thirty-five-year earnings history (up to the maximum annual earnings cap,
which is $97,500 for 2007) through age sixty adjusted for wage inflation. The
highest thirty-five years of wage-adjusted annual earnings are combined and
divided by 420 (12 months x 35 years) to derive a monthly amount.
This monthly amount is then put into a formula to derive the retiree's
monthly full retirement benefit. This formula is notably progressive. For a
worker turning sixty-two in 2006, the monthly benefit equals 90% of the first
$656, plus 32% of the next $3,299 (if any) plus 15% of any remaining
amount.'1 3 This monthly benefit is decreased if a retiree starts her benefits
before her full retirement age (sixty-five and eight months in 2006 and increasing to age sixty-seven by 2027) or increased if a retiree continues to work
beyond her full retirement age.104
In addition to retiree benefits, Social Security provides monthly benefits
for a retiree's dependents, spouse, and survivors. 01 5 A retiree's nonworking
spouse can retire and receive a benefit derived solely from her spouse's benefit.
This benefit is equal to 50% of the worker's benefit. 10 6 If the retiree dies leaving a surviving spouse, she is entitled to a monthly benefit equal to 100% of the
retiree's benefit for her lifetime, and any dependents will also receive monthly
benefits through age eighteen. 107
The Social Security benefit formula ensures that lower-wage workers and
their families will receive a critically higher return on their contributions than
higher wage workers. The current Social Security system particularly favors
married one-worker large families with low lifetime earnings. Immigrants benefit substantially from this formula because, on average, they have lower
incomes, a higher incidence of disability, more children per family, and longer
life expectancies.' l ' One study by Harvard economists found that Hispanics
enjoy a Social Security rate of return that is 35 to 60% higher than the rate of
return for the general population.09
A lower-wage worker earning $24,000 wage adjusted average annual
earnings for the last thirty-five years retiring in 2006 would receive tax-free,
inflation-adjusted Social Security benefits of $12,245 per year for the rest of
her life. If she is married to a nonworking spouse, upon his eligibility for benefits (based upon her work history) they would receive tax-free Social Security
benefits of $18,369 per year or almost 77% of their pre-retirement income.
103 FORMAN,
104
Id.
105
See
supra note 96, at 187-88.
SoC. SEC. ADMIN., SOCIAL SECURITY RETIREMENT BENEFITS 6-9 (2007), available
at http://www.ssa.gov/pubs/10035.pdf (describing retirement benefits under the Social
Security Retirement system).
106 Id. at 7-9.
107 See SOC. SEC. ADMIN., SOCIAL SECURITY SURVIVORS BENEFITS 6-7 (2006), available at
http://www.ssa.gov/pubs/10084.pdf (describing survivor benefits under the Social Security
Retirement system).
108 See FERNANDO TORRES-GIL ET AL., CTR. ON BUDGET AND POLICY PRIORITIES, THE
IMPORTANCE OF SOCIAL SECURITY TO THE HISPANIC COMMUNITY (2005), available at http://
www.cbpp.org/6-28-05socsec3.pdf (an extensive discussion of these issues).
109 JASON FURMAN, CTR. ON BUDGET AND
POLICY PRIORITIES, Top TEN FACTS ON 70TH
ANNIVERSARY FOR SOCIAL SECURITY 4 (2005), available at http://www.cbpp.org/8-1 105socsec.pdf.
BEARING WITNESS
Summer 2007]
This critical anti-poverty relief, which is contingent upon thirty-five years of
hard work and steady payment of regressive payroll taxes, is not available to
unauthorized workers and their families.
2.
How the Social Security Retirement System Doesn't Work
Unauthorized workers, who pay billions of dollars of Social Security taxes
each year on tens of billions of dollars of wages (one percent of total U.S.
wages), will never qualify for these critical Social Security benefits unless they
obtain work authorization and are legally present in the United States.' 'l After
President Bush signed the Social Security Protection Act of 2004 into law, a
noncitizen who files for Social Security benefits based on a SSN assigned on or
after January 1, 2004, is required to have work authorization at the time she
receives her SSN or at some later time. Only if noncitizens receive work
authorization and a valid SSN may they apply for Social Security benefits.
However, the benefits will be based on all Social Security-covered earnings
regardless of their work status during the earning period."' Notably, the
retiree has the burden of proving her earnings history and only wages reported
to the Social Security Administration ("SSA"), and not paid "under the table,"
count toward the required forty quarters of earnings to qualify for Social Security benefits.
Because unauthorized workers do not have a SSN, the SSA will not have
an accurate record of their earnings history. Accordingly, unauthorized workers must provide satisfactory documentation to the SSA evidencing their annual
earnings history. Currently, the SSA has a policy of assisting, and not prosecuting these workers, because its charge is to maintain correct earnings records.
However, this constructive policy is subject to change immediately. It is a
felony to use a SSN falsely: carrying a penalty of up to $5,000 and five years
in prison. Even if unauthorized workers become legal residents with work
authorization, many are too afraid to risk coming forward even to receive lifechanging Social Security benefits for decades of work.
Because of the complexity and lack of transparency in the Social Security
system, most U.S. citizens do not understand how their benefits accrue. Unauthorized workers, many of whom lack critical English language skills," 2 an
110 See
DAWN NUSCHLER
&
ALISON SISKIN, CONG. RESEARCH SERV., LIBRARY OF CONG.,
CURRENT POLICY AND LEGISLATION 7-8
(2005) (noting that unless contrary to a totalization agreement or Section 202(t) of the Social
SOCIAL SECURITY
BENEFITS FOR NONCITIZENS:
Security Act (the alien nonpayment provision), noncitizens not lawfully present in the
United States during any month may not receive Social Security benefits for such month).
' I Id. at 3-4. After President Bush signed the Social Security Protection Act of 2004, Pub.
L. No. 108-203, H.R. 743, § 211, 118 Stat. 518 (codified at 42 U.S.C.A. § 414 (West 2004)),
into law, a noncitizen who files a Social Security benefits application based on a SSN
assigned on or after January 1, 2004, is required to have work authorization at the time the
SSN is assigned or at some later time. If the worker receives authorization at some point, all
of her Social Security covered earnings would count toward her forty quarters of earnings of
at least $900 or $3,600 per year (in 2004) insured status requirement.
112
See
CAPPS ET AL., URBAN INST., THE HEALTH AND WELL-BEING OF YOUNG CHILDREN
17-20 (2004), available at http://www.urban.org/UploadedPDF/311139
-Childrenlmmigrants.pdf (finding "that immigrants who lack English.proficiency and have
lower educational attainment earn lower wages," and that the "[f]ack of English proficiency
OF
IMMIGRANTS
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[Vol. 7:736
education, 1 3 and any familiarity with the U.S. tax and retirement systems,
most likely are unaware that this substantial benefit is available to them. If
they have ten years of covered wages and obtain work authorization, they have
a lifetime of meaningful, anti-poverty family benefits awaiting them, amounting to hundreds of thousands of dollars. However, with long-term Social
Security deficits looming on the horizon, Congress and its constituents are
looking for increased Social Security contributions and decreased benefits. Not
surprisingly, many members of Congress have found their cash cow in vulnerable and hard-working undocumented immigrant families who have no meaningful opportunity to object.
3. Pouring Salt in the Wound. Congress Narrowly Defeats a
Provision to Deny Social Security Benefits to Otherwise Eligible
Lawfully Present Immigrant Workers
On May 18, 2006, the Senate narrowly defeated (50-49) Senator John
Ensign's (R-NV) amendment to deny Social Security quarterly credits to
legally present immigrant workers for work performed while the workers did
not have a SSN authorizing employment but upon which the worker and her
employer paid Social Security and Medicare taxes.' " This is not the first time
the Senate has considered this economic injustice. In 2003, the Senate Finance
Committee considered a similar proposal, but the then SSA Commissioner
stated that the proposal was not practicable. 1 5 The Commissioner stated in
writing that the information regarding immigration status, necessary to implement any accurate adjudication of benefits under this proposal, does not
exist. 116
Denying Social Security benefits for work upon which taxes were paid
would deter tax compliance for the millions of unauthorized workers and their
employers. According to the SSA's Chief Actuary, three-quarters of unauthorized workers pay payroll taxes.1 7 In 2003 these employers and their employees paid more than $8.5 billion in payroll tax revenues as well as federal and
state income tax withholding on $50-60 billion of reported wages. Should the
is also strongly associated with poverty, food insecurity, and other forms of economic hardship in immigrant families").
113 See PASSEL, NUMBERS AND CHARACTERISTICS, supra note 6, at 23 (comparing the percentage of native-born (7%) and legal immigrants (25%) who have not completed high
school and noting that 32% of unauthorized immigrants have less than a ninth grade
education).
"'
109 CONG. REC. S4739-47 (daily ed. May 18, 2006) (amendment 3985 to S.2611 (Comprehensive Immigration Act of 2006) (introduced to the 109th Congress on May 15, 2006
and tabled on May 18, 2006)); 109 CONG. REC. S4563 (daily ed. May 15, 2006) (text of
amendment).
"' See H.R. 1631, 108th Cong. (2003) (proposing to amend Title II of the Social Security
Act to exclude from creditable wages and self-employment income wages earned for services by aliens illegally performed in the United States and self-employment income derived
from a trade or business illegally conducted in the United States).
116 JONATHAN BLAZER, NAT'L IMMIGRATION LAW CTR., IMMIGRATION REFORM AND ACCESS
3 (2006), available at http://
www.nilc.org/immlawpolicy/CIR/cirandbenefits_2006-5-15.pdf.
117 109 CONG. REC. S4742 (daily ed. May 18, 2006) (statement of Senator Edward KenTO PUBLIC BENEFITS: THE RETURN OF AN UNEASY COUPLING
nedy, quoting Steven Goss, Social Security's chief actuary).
Summer 2007]
BEARING WITNESS
government implement this proposal, the unintended result might be that
employers would choose to pay unauthorized workers cash "under the 1table"
18
and forgo sending tax payments or any information to the IRS or SSA.
This mean-spirited strategy comes at a significant cost to the U.S. government. The National Taxpayer Advocate has warned, "a change in tax compliance of even one percentage point equates to an annual loss of more than $20
billion of revenue to the federal government."' 9 Moreover, "[o]ver the next
75 years, new immigrants will provide a net benefit of approximately $611
billion in present value to the Social Security system." 120 In short, this proposal is not only fundamentally unjust and un-American, it is poor fiscal policy
that could undermine the continuation of the most successful social welfare
program for White retirees and their families.
IV.
INACTION IS NOT AN OPTION
The insidious casting of blame for all of the economic pressures in
America on undocumented immigrants is a dangerous and ineffective approach
to problem solving. Sadly, it has haunting historic precedence in America and
in Congress. Alarmist propaganda must be countered with persistent education
and by disseminating accurate information describing any injustice.
As the debates in Congress and across this country continue, unauthorized
workers will likely continue to pay regressive Social Security taxes and never
receive otherwise available Social Security benefits for such years. And
undocumented working poor immigrant families will pay taxes at a shockingly
high effective marginal tax rate because they do not receive EITC benefits
(even in some cases where every worker in the family is authorized to work).
Although the public at large is unaware of the details of these economic injustices, it is incensed and outraged at the situation.
This fury is misguided. The public feels victimized and believes that
undocumented immigrant families are reaping enormous windfalls. Restrictionists have focused the public's attention and fueled its venom on inflammatory misinformation about undocumented immigrants."2 1 Many Americans
118 See Singer & Dodd-Major, supra note 70, at 1432.
119 Id. at 1432-33.
120 NAT'L
IMMIGRATION
LAW
CTR.,
PROPOSED
ENSIGN
AMENDMENT
TO
IMMIGRATION
REFORM BILL WOULD STRIP IMMIGRANT WORKERS OF SOCIAL SECURITY EARNINGS:
FOR THE
SYSTEM
AND
AN
AFFRONT TO
OUR
VALUES
BAD
(2007), http://www.nilc.org/
immlawpolicy/CIR/cir015.htm.
121 Recent studies indicate that 68 or 74% of Americans believe that undocumented immigrants are a very or extremely serious problem. Fifty-two percent say "immigrants today are
a burden on our country because they take our jobs, housing and health care." When asked
"Do you think illegal immigrants do more to strengthen the U.S. economy because they
provide low-cost labor and they spend money, or do illegal immigrants do more to weaken
the U.S. economy because they don't all pay taxes but use public services?" seventy percent
said weaken.
RuY TEIXEIRA, CENTURY FOUND. AND CTR. FOR AM. PROGRESS, WHAT THE
PUBLIC REALLY WANTS ON IMMIGRATION
cations/MediaPolitics/teixeira6-28-06.pdf.
2-3 (2006), availableat http://www.tcf.org/Publi-
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[Vol. 7:736
believe that undocumented immigrants do not pay any taxes and consume billions of dollars of government benefits annually.' 22
The exact opposite is true. Undocumented immigrants pay billions of dollars in taxes annually and do not qualify for most government benefits including EITC, Social Security, and Medicare. "[E]very empirical study of illegals'
economic impact demonstrates the opposite... : undocumenteds actually contribute more to public coffers in taxes than they cost in social services."12' 3
Undocumented immigrants provide a fiscal windfall to America and may be the
most fiscally beneficial of all immigrants.' 2 4
Because of increasing complexity and lack of transparency in U.S. tax,
retirement, welfare, and immigration systems, race-based discrimination is easy
to conceal and misrepresent. The victim becomes the enemy, solely responsible for all perceived and imagined problems. President George W. Bush has
stated that "no really respectable person wishes to be supported by others" and
that the goal of welfare reform is "returning [welfare recipients and their families] to lives of self-reliance and dignity." The public's focus has been
deflected from ill-functioning U.S. institutions, and has been finely-tuned on
welfare recipients and undocumented immigrants. Undocumented immigrants
have become a new scapegoat for any real or imagined problem in the U.S.
economy, including unemployment, low wages, exploding deficits, the looming
Social Security crisis, and failing health care services.
Undocumented immigrants have little or no recourse for economic injustice. Despite America's historically strong opposition to taxation without representation, undocumented immigrants have not enjoyed the right to vote on
any local, state, or federal tax for almost eighty years, except in rare and unusual cases.' 25 Furthermore, because of their precarious immigration and economic status, undocumented immigrants are vulnerable to deportation and
exploitation and are chilled from protesting any injustice. As a result, they
suffer economic injustices daily, which translate into lower prices for countless
122
See Francine J. Lipman, The Taxation of Undocumented Immigrants: Separate, Une-
qual, and Without Representation, 9
HARV. LATINO
L. REV. 1, 1-2 (2006) (citing numerous
studies and surveys of support).
123 Peter L. Reich, Public Benefits for Undocumented Aliens: State Law into the Breach
Once More, 21 N.M. L. REV. 219, 243-46 (1991) (discussing the voluminous empirical
literature supporting the "net economic benefit" of undocumented immigrants on the federal,
state, and local economies).
124 JULIAN L. SIMON, THE ECONOMIC CONSEQUENCES OF IMMIGRATION 295 (1989) (con-
cluding that undocumented immigrants are a national fiscal asset after reviewing "every
study that provides dollar estimates show[ing] that when the sum of the tax contributions to
the city, state and federal government are allowed for, those payments vastly exceed the cost
of services used, by a factor of perhaps five, ten or more").
125 The election of 1928 was the first national election in which no immigrant had the right
to vote in any national, state, or local election. See Virginia Harper-Ho, Noncitizen Voting
Rights: The History, the Law and Current Prospectsfor Change, 18 LAW & INEQ. 271, 282,
295-14 (2000) (describing the fierce opposition to granting voting rights to undocumented
(and documented) immigrants and finding the rare cases in which undocumented immigrants
can vote in certain elections including school board elections in New York and city tax
matters in Takoma Park, Maryland). i"[M]ost scholars advocate extending [voting rights] to
permanent residents who have met relevant residency requirements for the jurisdiction." Id.
at 306.
Summer 2007]
BEARING WITNESS
goods and services that are an everyday part of privileged life in America. The
burden of speaking out loudly and clearly about these injustices therefore is
ours.
Inaction is not an option, because taking its course is action. As German
student resisters proclaimed against the Nazi regime: "Every people deserves
the government it is willing to endure."' 126 "Nothing is so unworthy of a civiopposition by an irrelized people as allowing itself to be governed without
127
sponsible clique that has yielded to base instinct."'
V.
CONCLUSION
As a country of immigrants, we cannot forget that America's success is
due to the hard work, loyalty, and commitment of a melting pot of immigrants
from across the globe. 128 The economic injustices described in this Essay are
only two examples of too many. In addition to economic injustices, undocumented immigrant families suffer routine physical abuse as well. The death
rate of enhanced security border crossings has tripled. The U.S.-Mexican border has become a private hunting ground for racist vigilantes who proudly propatrol into their own hands,
claim themselves as loyal Americans taking border
129
which carry and use lethal military weapons.
Race-based fear and hate are a toxic mixture that, if left unchecked, can
explode into destructive violence. The complexity and lack of transparency in
the U.S. tax, retirement, welfare, and immigration systems can result in the
inability of most Americans to provide a meaningful check and balance. Without any understanding of fundamental government systems, misinformation can
spread like wildfire, and is just as dangerous. As scholars, academics, and lawyers studying these systems, it is our burden and privilege to ferret out the
issues and shine a bright light for all to witness and understand.
America's past history reveals unspeakable persecutions. "But we can
hope . . . that the recollection of the past can prevent its recurrence."' 30 As
Ansel Adams, renowned photographer, so eloquently wrote in his book, Born
Free and Equal, on the internment of nearly 120,000 people of Japanese ancestry from early 1942 through late 1945:
126 BERENBAUM, supra note 17, at 171 (quoting from correspondence that came to be
known as the "White Rose Letters").
127 Id.
128 "Give me your tired, your poor, Your huddled masses yearning to breathe free, The
wretched refuse of your teeming shore. Send these, the homeless, tempest-tossed to me. I
lift my lamp beside the golden door." Lazarus, supra note 37, vol. 1, at. 2. Emma Lazarus's
famous sonnet has come to symbolize the Statue of Liberty's universal message of hope and
freedom for immigrants coming to America and people seeking freedom around the world.
129 For a disturbing and scathing critique of the chaos at the U.S.-Mexico border see a film
by Jeremy Levine and Landon Van Soest, WALKING THE LINE (Two Headed Productions
2005), information available at http://www.walkingthelinefilm.com (last visited May 2,
2007).
130 BERENBAUM, supra note 17, at xxi (recounting that Vice-President Walter Mondale
invoked the failure of the United States to rescue Jews during the Holocaust at the Evian
Conference at the International Conference on the Boat People resulting in outreach across
the globe that allowed the boat people to rebuild their lives).
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[Vol. 7:736
We, as citizens, can agitate for tolerance and fair play, but our agitation must be
dynamic and persistent. It is easy for a "fair-weather lover of the Constitution" to
"favor" tolerance, and mouth principles of democracy, but it is quite another thing to
stand up against opposition and fight for principles.13 ' It is our task to retain the
32
individual as the foundation of society, irrespective of his race, color or religion. 1
We must be certain that, as the rights of the individual are the most sacred elements
of our society, we will not allow passion, vengeance, hatred and
racial antagonism to
13 3
cloud the principles of universal justice and mercy [for all].
It is a problem we must face and solve - no matter what the cost may be to
our false dignity or imagined
self-interest. Left unsolved, the cost will prove
1 34
beyond computation."'
135
We must bear witness.
supra note 11, at 113.
Id. at 118.
133 Id.
134 Id. at 115.
135 "I have told you this story not to weaken you. But to strengthen you. Now it is up to
you!" BERENBAUM, supra note 17, at xxi (quoting the words from a survivor of Sachsenhausen, a concentration camp).
131 BoRN FREE AND EQUAL,
132